20230907-招银国际-三峡能源-600905.SH-Sound_business_operation__rising_depreciation_drags_on_earnings_6页_1mb

CTGR Group (600905 CH) reported strong revenue growth for the first half of 2023, with a 12.98% year-on-year increase to RMB13.70 billion, driven by resilient power generation. However, attributable net profit declined by 10.10% YoY to RMB4.52 billion, primarily due to rising operating costs, including higher depreciation from accounting standard changes and increased management fees. Power generation grew 14.55% YoY, and on-grid tariffs slightly exceeded expectations, but overall earnings were pressured by cost increases.

The company has numerous projects in development with a total planned capacity of 13.2 GW, expected to start operation from the second half of 2023, which will fuel future growth and potentially improve project internal rates of return as upstream costs decrease. Analyst maintains a BUY rating with an adjusted target price of RMB6.24 (down from RMB6.79), citing optimism over solid power generation growth and upcoming project milestones. Current stock metrics include a market cap of RMB141.9 billion and a 1-year price performance showing mixed results, but fundamentals support the positive outlook.

Key financial outlook: Revenue is expected to grow steadily over FY23-25E, with NP estimated at RMB8.93 billion, 10.53 billion, and 12.956 billion, but PE ratios and other metrics indicate a downward adjustment due to cost pressures. Risks include dependency on project execution and evolving market conditions.